Causes And Effects Of Delays in Projects

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In this chapter, I will discuss types, causes and effects of delay of project in the construction industry. Besides that, I will also discuss the method to minimize the delays happening in construction industry 2.2 Type of Delay In construction industry, there are the categories of delays used in determining delay damage as shown in table 2.1 Figure 2.1 Types of Delay 2.2.1 Excusable delays Excusable delay as define a delay that is due to an unforeseeable event beyond the contractor’s or the subcontractor’s control. Usually, based on common general provisions in public agency specifications, delay resulting from the following events would be considered excusable such as fires, floods, owner-directed changes, errors and omissions in the contract drawing, unusually severe weather and etc. Excusable delays can be further classified into excusable with compensation and excusable without compensation.

2.2.1.1 Excusable with compensation

Compensation delays are caused by the owner or the owner’s agents. An example of this would be the drawings late release from the owner’s architect. An excusable, compensable delay normally leads to a schedule extension and exposes the owner to financial damages claimed by the contractor. In this scenario, the contractor incurs additional indirect costs for both extended field office and home office overhead and unabsorbed home office overhead.

2.2.1.2 Excusable delays without compensation

Non-compensable delays are caused by third parties or incidents beyond the control of both the owner and the contractor. Examples typically include acts of God, unusual weather, strikes, fires, acts of government in its sovereign capacity, etc. In this case, the contractor is normally entitled to claim extension of time but no compensation for delay damages

2.2.2 Non-excusable delays

Non-excusable delays are cause by lack of performance of the contractor on the construction project. This delay can be cause by underestimates of productivity, improper project planning and scheduling, poor site management and supervision, wrong construction methods, equipment breakdowns, unreliable subcontractors or suppliers. Therefore, it is contractor responsibilities to continue their work with no entitlement to claim for extension of time or delay damages until they completed the project. For instance, a contractor failure to provide an adequate material to completed their job.

2.2.3 Concurrent Delay

Concurrent delay is a problem that happening on most of the construction industry project. This issue arises when two or more delaying event at the same time in a project cannot complete on time. In this situation, both owner and contractor are responsible for the delay. Commonly concurrent delays which involve any two or more excusable delays result in extension of time. When excusable with compensation and non-excusable delays are concurrent, an extension of time can be issued or the delay can be distribution between the owner and the contractor. Concurrent delay can be categories in three types of delays: If excusable and non-excusable delays occur concurrently, the contractor only to allow claim for extension of time: If excusable with compensation and excusable without compensation delays occur concurrently,

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